5 questions to ask your bank about refinancing

FINDING WAYS TO SAVE WITHOUT DIMINISHING YOUR LIFESTYLE IS KEY RIGHT NOW. THE ANSWER COULD BE AS SIMPLE AS TAKING A CLOSER LOOK AT YOUR HOME LOAN

Home loan refinancing is a hot topic right now, and the benefits can really stack up. Here are five definitive questions to ask your bank to help you find out whether refinancing can put you in front financially.

1. Can refinancing help me save on home loan repayments?

Plenty of Australians are taking a closer look at their finances to find ways to save. Your home loan is likely to be one of your main regular expenses, and even a small cut in the loan rate can mean a valuable reduction in monthly repayments, with significant savings on the long-term cost of the loan.

Ask your lender or broker to crunch the numbers to show how much you could save by refinancing.

2. When should I think about refinancing?

If you’ve had your home loan for a few years or more, chances are you could save by refinancing. Home loan rates have dropped considerably in recent years – especially since March 2020, when the Reserve Bank cut the cash rate not once, but twice. That makes it worth looking to see if you’re paying more than necessary on your current loan.

3. I’ve been with the same bank for years … why change now?

Loyalty is a great quality. But when it comes to your home loan, staying with the same lender can cost you dearly. Research by the Reserve Bank shows that lenders often save their best deals for new customers. In fact, some lenders are offering interest rates to new customers that are 1.5% cheaper than the rates being paid by existing borrowers. It’s a good reason to check out how much you could save by switching to a new loan.

4. How much will it cost me to switch to a new loan?

Every situation is different, but refinancing can come with costs including possible exit fees on your old loan and upfront fees on the new loan. However, the savings on loan interest can often help you recoup these costs in just a few months.

What’s really exciting is that some lenders are making refinancing even more affordable with valuable cashback offers. Suncorp Bank, for instance, has a Refinance Cash Bonus that’s worth up to $3000. If you’re a frontline worker in health, education or emergency services, you could be eligible for a bonus of up to $4000.

5. I’d like to renovate – can refinancing free up funds?

Yes! Renovating can spruce up your home, your lifestyle – and your property’s value. And the new $25,000 HomeBuilder cash grant can be a big financial helping hand towards your home improvements.

Even better, refinancing can be a way to tap into home equity and access low cost funds to complete your project – often without having to dip into precious cash savings. It could mean your dream home is only as far away as a new home loan.

To learn more about how refinancing can help you save, head to www.suncorp. com.au or contact your broker.